Sales and OperationalSales and OperationalPlanningPlanning

AgendaAgenda– What is S&OP ?

– S&OP

– Process Overview

– Demand Review

– Supply Review

– Pre S&OP

What is S&OP?What is S&OP?• What is it?

– “Sales & Operational Planning”

– Business planning discipline

• What does it do?

– Improves the overall cross functional communication across the business and to arrive at a business “game plan” to help manage and allocate critical resources to meet the needs of the customer.

– It ensures better coordination of company resources in delivering the business goals

• How can we benefit?

– Improved visibility

– Reduce costs/inventory

– Better planning and execution

– Improve customer service

– Increase team work within and across functions

S&OP – 5 Step ProcessS&OP – 5 Step Process

S&OPActual Vs. Plan

Exceptions/Issues

Pre S&OPDemand/Supply Balancing

Actual vs. Plan

Financial review to plan

Validation of previous steps

Performance Measures & Resources

Demand PlanningSales vs. Forecast vs. Plan

Supply PlanningProduction vs. Plan

Capacities

Safety stock

Historical Data Generation

2

3

4

5

1

Key MeetingsKey MeetingsFormal Meetings

1. Demand review

Sales & Marketing & Supply Chain

Day 6 of each month

2. Supply review

Supply Chain & Logistics

Day 7 of each month

3. Pre S&OP (Financial Review)

All Functions – CODI -1

Day 9 of each month

4. S&OP review

Key Functional Representative & CODI

Day 10 of each month

Demand ReviewDemand ReviewDemand Review

• Gain consensus on what will be sold each month for each product

• Continuous improvement in Forecast accuracy is the driver behind the demand review

• Document assumptions

– NPD

– Deletions

– Market/competitors etc…

• Meeting Chair – Shareef Khan/Manuel

• Participants;

– Sales

– Marketing

– Supply Chain/Logistics

Demand ReviewDemand ReviewDemand Review

• Meeting Agenda

– Review Prior months sales (Historic Review)

• Vs forecast

• Vs E1

• Review KPI’s

– Forecast Accuracy %

– Forecast Bias

• Review Forward Projections

– Same format as Historic review. (Looking out 24 months)

• Review activity calendar

Demand ReviewDemand ReviewDemand Review

• Output

– Clear set of minutes

– Consensus volume projection

– Highlight “time fence” breaches

– Documentation of any actions that need to be made ie change/moving promotions/NPD launches etc…

– Volume file to be sent to Supply Chain

– Volume File to be sent to Finance

Supply ReviewSupply ReviewSupply Review

• Develop a proactive approach to resolving imbalances in capacity & resources

• Document assumptions

– Supply constraints

– Procurement plan

– Utilisation plan

• Meeting Chair – Shareef Khan

• Participants;

– Supply Chain

– Logistics

Supply ReviewSupply ReviewSupply Review

• Meeting Agenda

– Review Prior months production/supply performance (Historic Review)

• Vs projection

• Vs Budget

• By Supply Point & Product

• Review KPI’s

– Delivery Performance

– Write offs & aged inventory

• Review Forward Projections

– Same format as Historic review. (Looking out 24 months)

Supply ReviewSupply ReviewSupply Review

• Output

– Clear set of minutes

– Action plans to ensure delivery of demand volumes

– Capacity Schedules

– Financial Implications of action plans to be costed

– Consensus on plan of action to deliver volumes

Pre S&OPPre S&OPPre S&OP

• This is the finalisation of the plans from each of the functions

• The final opportunity to refine the plans Vs the business goals

• It’s the opportunity to review gaps and resolved action plans

• Identification of any issues that cannot be resolved and need to be escalated to EMT

• Meeting Chair – SMT member

• Participants;

– SMT

– Other participants (as required)

Pre S&OPPre S&OPPre S&OP

• Meeting Agenda

– Review KPI’s out of Demand & Supply reviews

– Review gaps and gap closing opportunities

• KPI Review

– P&L Vs

• E1

• Last months review

– Inventory Targets

– Resource recommendations

• Outputs

– Clear Minutes with actions

– Document issues that need escalation to CODI

– Final consensus business plan

Business ScorecardBusiness Scorecard

• Previous month• Target• Current month

S&OP Business ScorecardPrevious Month Target

Current Month Comments

Financial Total Sales (CANN)Management Result

Demand Forecast AccuracyForecast Bias

Supply Inventory (Total FG)FG Days CoverInventory (R&P)R&P days Cover

Production Total Produced (Tons)Logistics Service Level

S&OPS&OPSales & Operations Review

• Formalise the business plans by resolving any issues or imbalances that have been brought to the meeting

• Review of Demand, Supply and Financial plans

• Approve plans

• Meeting Chair - Kevin Bush

• Participants;

– Executive Team

– SMT

• OUTPUT

– Accept or change proposals

– Choose from alternatives provided

– “GAME PLAN”